The U.S. Securities and Exchange Commission has hired an external agency to review its handling of whistleblower complaints, in an effort to improve its ability to deal with these sorts of tips from the public.

The move, which was announced Thursday, comes in the wake of the Madoff scandal, which the SEC missed despite a tipster’s efforts to motivate an investigation.

The SEC announced that it has enlisted the services of the Center for Enterprise Modernization to conduct a comprehensive review of internal procedures used to evaluate tips, complaints, and referrals. The review will scrutinize the agency’s processes for receiving, tracking, analyzing, and acting on tips, complaints, and referrals from these outside sources. The goal of the review is to improve the efficiency, effectiveness, and overall management of how the agency addresses tips, complaints, and referrals, and how SEC staff utilizes the information received to protect investors.

The agency says it is seeking to establish a more centralized process that will more effectively identify valuable leads for potential enforcement action as well as areas of high risk for compliance examinations.

“As we continue to reinvigorate our enforcement efforts as an agency, it’s vitally important that we move very aggressively to improve staff’s use of tips and complaints from investors and whistleblowers,” said SEC chairman Mary Schapiro. “This comprehensive review will help us identify and improve areas within the agency where gaps or lack of communication may cause breakdowns that prevent us from ensuring swift and vigorous enforcement.”

IE